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Adams v. Nature's Expressions Landscaping, Inc.

United States District Court, E.D. Kentucky, Central Division, Lexington

October 25, 2017

THOMAS ADAMS, et al., Plaintiffs,
v.
NATURE'S EXPRESSIONS LANDSCAPING INC., Defendant.

          MEMORANDUM OPINION AND ORDER

          Joseph M. Hood Senior U.S. District Judge.

         I. INTRODUCTION

         When employees work more than forty hours in a week, they expect overtime pay. Under the Fair Labor Standards Act (“FLSA”), employees working these hours are entitled to time-and-a-half, unless the Act exempts them. Employees at Nature's Expressions Landscaping, Inc. (“NEL”) claim they have worked more than forty hours per week. They are not exempt from the FLSA. And now they want their overtime pay. So they have filed a collective action in this Court asking for their money.

         But NEL argues it owes nothing. Some Plaintiffs, according to NEL, never worked for the company. Others work under contracts specifically spelling out overtime and straight time pay. In fact, NEL claims the company compensates some employees above what the FLSA requires. These employees, NEL argues, do not understand how their own wages are calculated. And finally NEL argues that some employees trying to join this action simply filed too late. So NEL now asks for Summary Judgment or, in the alternative, Decertification of four groups of plaintiffs. Plaintiffs have responded [DE 43], and Defendant filed a reply [DE 45] making the matter ripe for review.

         For the reasons stated herein, Defendant's Motion for Partial Summary Judgment is GRANTED IN PART, DENIED IN PART, and DENIED IN PART AS MOOT. Defendant's motion for Decertification is DENIED.

         II. FACTUAL AND PROCEDURAL BACKGROUND

         Plaintiffs Thomas Adams, Adam Allnut, Frankie Anderson, Steven Atwood, Charles Cook, John Heska, and Ron Stewart filed this action on March 30, 2016 seeking unpaid overtime wages under the FLSA. [DE 1]. Plaintiffs worked for NEL, a landscape architecture firm that “creates and constructs outdoor living spaces for clients throughout central Kentucky.” [DE 1-1 at p. 7-8, ¶17]. NEL pays employees a set rate per day. [Id. at p. 8, ¶18]. Plaintiffs allege that this compensation scheme violates the FLSA because it does not account for overtime hours. [Id. at p. 8-14].

         As the Plaintiffs describe it, NEL assigns each employee a daily wage based on his position and duties. [Id. at p. 8-9, ¶20]. Each employee is required to work a certain number of hours per day, which is divided into “quarter days.” [Id. at p. 9, ¶22]. NEL tracks the number of hours worked by each employee, and then rounds that number to the nearest quarter day. [Id.]. NEL pays the employee the sum equal to the employee's agreed upon day rate, prorated by quarter days worked. [Id.]. For example, NEL might require an employee to work ten hours per day and pay that employee $160 per day, based on the ten hours of work. [Id. at p. 10, ¶23]. But on any given day, if that employee works only 7.5 hours, his $160 per day would be prorated to three-fourths of the total daily rate. [Id.]. Plaintiffs claim NEL uses this method for all work, even if employees work more than 40 hours in a week. [Id. at p. 12, ¶26].

         Put simply, Plaintiffs claim NEL is not paying time-and-a-half for overtime. Plaintiffs have suspected as much since early 2016, when Ron Stewart and Steven Atwood filed administrative complaints with the Kentucky Labor Cabinet (“KLC”) seeking unpaid overtime wages. [Id. at p. 15, ¶36]. The KLC began investigating NEL's compensation practices, and even visited NEL premises. [Id.]. Although Stewart and Atwood later withdrew their complaints, the investigation remains pending, but its status is unknown. [DE 1-1 at p. 15; 24].

         A short time after filing with the KLC, Stewart and Atwood, along with the other named Plaintiffs, filed this action in Jessamine Circuit Court seeking overtime wages under the FLSA. [DE 1-1]. Plaintiffs also filed retaliation claims under the FLSA and state-law claims under the Kentucky Work and Hour Act (“KWHA”). [Id.]. NEL promptly removed the case to this Court on the basis of federal question and supplemental jurisdiction. [DE 1].

         After the Defendant filed its Answer, the Plaintiffs moved pursuant 29 U.S.C. § 216(b) to conditionally certify this case as a collective action. [DE 14]. Under that provision of the FLSA, similarly situated plaintiffs may bring their cases together as a collective. 29 U.S.C. § 216(b).

         The Court granted Plaintiffs' motion in a November 1, 2016 Memorandum Opinion and Order. [DE 26]. The Order approved Plaintiffs' proposed notice and opt-in consent forms. These forms were sent to the “FLSA Notice Group, ” which included “all individuals currently or formerly employed by NEL who, within the three-year period preceding the date of this Court's certification Order, were compensated under the ‘day-rate' scheme, as that term is described in Plaintiffs' Complaint, and who worked hours in excess of forty (40) during any week throughout the course of their employment.” [DE 22 at p. 10]. This group had ninety days to fill out the paperwork and join the class. [Id. at p. 11]. All opt-in consent forms would be “deemed to have been filed with the Court the date that they are stamped as received.” [Id.]. The deadline was set for February 12, 2017. [DE 28-1]. Since that Order issued, many current or former NEL employees have completed and submitted opt-in forms. [DE 27; 28; 29; 30; 31; 32].

         NEL argues that several opt-in Plaintiffs either do not meet the criteria to join this collective action or simply do not have a case. [DE 39]. Defendant's motion addresses only opt-in Plaintiffs and not the original Plaintiffs already conditionally certified. [DE 26]. Defendant groups these opt-in Plaintiffs into four categories: (1) persons who never worked for Defendant NEL; (2) persons who opted in to the lawsuit after the expiration of the opt-in period; (3) persons who never worked more than 40 hours in any given week for NEL; and (4) person whose employment agreements state NEL's policy of straight time and overtime pay. [DE 39; 45].

         The Court will discuss each group of Plaintiffs and the parties' arguments in turn.

         III. STANDARD OF REVIEW

         A. Summary Judgment

         Summary Judgment is appropriate when no genuine dispute as to any material fact exists and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). To prevail on summary judgment, the moving party must show “that there is an absence of evidence to support the nonmoving party's case.” Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). A genuine issue of material fact exists only if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby Inc., 477 U.S. 242, 248 (1986). Thus, the Court considers “whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.” Id. at 251-52.

         In considering a summary judgment motion, the Court must construe the facts in the light most favorable to the nonmoving party. Anderson, 477 U.S. at 255. Once the moving party has met its burden of production, the nonmoving party must “go beyond the pleadings” through the use of affidavits, depositions, answers to interrogatories and admissions on file, and designate specific facts showing that there is a genuine issue for trial. Celotex, 477 U.S. at 323-24. A mere scintilla of evidence is insufficient; “there must be evidence on which the jury could reasonably find for the [nonmovant].” Anderson, 477 U.S. at 252.

         B. Decertification

         “[T]he FLSA authorizes collective actions by any one or more employees for and on behalf of himself or themselves and other employees similarly situated.” Monroe v. FTS USA, LLC, 860 F.3d 389, 397 (6th Cir. 2017)(quoting 29 U.S.C. § 216(b)). Similarly situated employees may “opt-into” such suits by “signal[ing] in writing their affirmative consent to participate in the action.” Comer v. Wal-Mart Stores, Inc., 454 F.3d 544, 546 (6th Cir. 2006).

         “The FLA does not define the term ‘similarly situated.'” Tassy v. Lindsay Entm't Enter. Inc., NO. 3:16-CV-00077-TBR, 2017 WL 938326 (W.D. Ky. Mar. 9, 2017). But Courts in this circuit “typically bifurcate certification of FLSA collective action cases.” Monroe, 860 F.3d at 397. “At the notice stage, conditional certification may be given along with judicial authorization to notify similarly situated employees of the action.” Id. Such certification is “by no means final.” Comer, 454 F.3d at 546-47. “The plaintiff must show only that his position is similar, not identical, to the positions held by the putative class members.” Id. (internal quotations omitted). “[T]his determination is made using a fairly lenient standard, and typically results in conditional certification of a representative class.” Id. (stating further that “authorization of notice need only be based on a modest factual showing”) (internal quotations omitted).

         “Once discovery has concluded, the district court - with more information on which to base its decision and thus under a more exacting standard - looks more closely at whether the members of the class are similarly situated.” Monroe, 860 F.3d at 397. The final-certification decision depends upon “a variety of factors, including the factual and employment settings of the individual[] plaintiffs, the different defenses to which the plaintiffs may be subject on an individual basis, [and] the degree of fairness and procedural impact of certifying the action as a collective action.” O'Brien v. Ed Donnelly Enter., Inc., 575 F.3d 567, 584 (6th Cir. 2009) (internal quotations omitted), overruled on other grounds by Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016).

         IV. DISCUSSION

         “Congress enacted the FLSA in 1938 with the goal of ‘protect[ing] all covered workers from substandard wages and oppressive working hours.'” Christopher v. SmithKline Beecham Corp., 132 S.Ct. 2156, 2162 (2012) (quoting Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 728, 739 (1981)); see also 29 U.S.C. § 202(a). Overtime pay makes up a critical aspect of the FLSA. 29 U.S.C. §207(a). This “obligates employers to compensate employees for hours in excess of 40 hours per week at a rate of 1 ½ times the employees' regular wages.” Christopher, 132 S.Ct. at 2162. Employees can enforce this requirement through a collective action, which authorizes employees to sue on their own behalf and for all similarly situated persons. 29 U.S.C. § 216(b).

         A. Group One: Employee Who Never Worked for NEL

         No one named Dimitri Roskolov ever worked for NEL. [[DE 39 at p. 4]. Plaintiffs' counsel admits as much. [DE 43 at p. 4]. Indeed, Roskolov could not have worked at NEL because he does not exist. [DE 39 at p. 4; 43 at p. 4]. Yet, Plaintiffs' counsel listed a “Dimitri Roskolov” as an opt-in Plaintiff to this lawsuit. [DE 27-2]. Defendant claims that because the parties agree that a Roskolov never worked for NEL, no genuine issue of material fact exists as to his claims. [DE 39].

         Plaintiffs' counsel attributes the mix up to an illegible signature and an unfortunately named e-mail address. [DE 43 at p. 4]. William “Chad” Austin is the real person who signed the consent form on November 16, 2016. [Id.]. When Plaintiffs' counsel received the form, the form did not include a printed name. [Id.]. The signature was illegible. [Id.]. But the e-mail address provided included the name “Dimitri Roskolov.” [Id.]. Plaintiffs' counsel assumed the sender's name was, in fact, Dimitri Roskolov. It was not.

         Even if the Court were inclined to grant Defendant's Motion, doing so would have no effect on Austin's legitimate claim. And allowing Austin to join this collective action does not prejudice NEL since Austin could file a new lawsuit himself. Plaintiffs did not engage in any tactical maneuvering to NEL's disadvantage. And Austin - the real party in interest - returned a timely and proper consent form. The Court sees no reason to punish Austin for a mistake that has since been corrected.

         Defendant's Motion for Summary Judgment as to the claims of Dimitri Roskolov are DENEID. Plaintiffs will be permitted to substitute William ...


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